While it hasn’t been the question of the past, one likely of the future is: What will it take for our children to retire in style?
Truly, they face a host of challenges. Prices do go up and while we have been fortunate since the 70’s to have controlled prices, there is no guarantee we won’t see high inflation for pricing in our children’s futures. Couple this with our children living into their 90’s and little help from the government or corporate pension system, Generation Z will have to either save far beyond what most expect or inherit substantial amounts from family.
Saving: Today’s 15-year-olds will to need to have approximately $6 million sacked away in order to enjoy a 20-year retirement with the same buying power they had during the height of their careers, according to multiple experts. Said another way, that same 15 year old would need to save $10,000 per year until age 75 if they averaged a 7 percent return.
Inheriting: For every $100,000 of assets inherited, this would provide approximately $4,000 per year of income for a life time if assets earn a moderate return and remain relatively intact.
Looking at the total needs of the family throughout the generations can pay huge dividends for the longevity of family wealth and lifestyle.
This information has been obtained from sources considered to be reliable, but Raymond James does not guarantee that the foregoing material is accurate or complete. Any opinions are those of Shari Burnum and not necessarily those of RJFS or Raymond James. The examples are hypothetical in nature for illustration purpose only and do not represent an actual investment